The United States will reinforce the military capability of Israel and Saudi Arabia in a strategy intended to deter Iran.

Ehud Olmert, the Israeli prime minister, confirmed yesterday that US military aid would rise by 25 per cent over the next decade, from £12 billion to £15 billion a year.

Meanwhile, US military sources reported that Saudi Arabia was on the verge of signing a deal to buy approximately £12 billion of arms and support equipment. The Saudi kingdom has an internal jihadist problem, yet Washington still values the support it gives for the mission in Iraq and for other policies across the Middle East.

Normally, Israel opposes US military links with Arab nations but on this occasion Mr Olmert said that he appreciated the need for beefing up the military capability of moderate states such as Saudi Arabia.

However, Mr Olmert described the US donation to his own country as proof that Washington wanted Israel to maintain a military advantage over its Arab neighbours.

"Other than the increase in aid, we received an explicit and detailed commitment to guarantee Israel's qualitative advantage over other Arab states," he said.

President Mahmoud Ahmadinejad of Iran has caused jitters across the region with a series of inflammatory speeches that allude to destroying Israel, a threat made more serious by Iran's ambitions for a nuclear programme. While some Israeli commentators have called for a pre-emptive strike, diplomacy has prevailed up to now.

But with President George W Bush increasingly distrustful of Iran and with US-led forces in Iraq finding more and more evidence of outside meddling in the insurgency, the likelihood of some sort of military confrontation is growing.

However, in an interview with the German magazine Focus, Iran's foreign minister dismissed the idea, saying that US forces were too stretched by conflicts in Afghanistan and Iraq. The US "is not in a position to get into a new military conflict", said Manouchehr Mottaki, adding that "a total of 170,000 American soldiers can guarantee neither their own safety nor the security of Iraq".

By boosting the military capability of both Israel and Saudi Arabia, Washington can be sure of having stronger regional allies in the event of combat.

Israel launched a pre-emptive strike against Saddam Hussein's nascent nuclear programme back in the 1980s. But an attack today on Iran would have to be carefully co-ordinated with the US which controls Iraqi airspace through which Israeli jets would have to pass.

Military support has been the main pillar of US aid to Israel for many years and the increased assistance arrives in a form of financial credits that must be spent upon military technology and know-how. The US's annual donation makes Israel the recipient of the largest amount of aid per capita in the world.

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